WTI crude oil futures have dropped significantly as reports emerge of diplomatic talks between the U.S. and Iran. Markets are pricing in the potential for a phased deal that could reopen the critical Strait of Hormuz, a key channel for global oil transport, and ease sanctions on Iran. This optimism is currently overshadowing recent supply disruption fears from Houthi attacks on Saudi Arabia. The move in WTI is exacerbated by concerns over a potential U.S. ban on diesel exports, which has widened the price gap between WTI and the international Brent benchmark.